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Sydney - Monday - July 31: (RWE Australian Business News) - Brandrill Ltd (ASX code: BDL) today advised that annual operating profit was now expected to be 15 to 20 per cent above previous advice.

 

"This will be a good operational result, reflecting the slow and continuing flow-through of the strong trading conditions in the Australian mining industry," directors said.

 

The company previously forecast that for the year to June 30, gross sales would be in the order of $100 million with a likely profit margin of 5 per cent.

 

Because of Brandrill's tax loss situation, the advice indicated a profit of around $5 million both before and after tax. In today's update, Brandrill said it was also likely that there

would be an accounting requirement to recognise a deferred tax asset relating to tax losses to the extent it was probable these losses would be utilised in future periods.

 

The recognition of this deferred tax asset is likely to increase net profits of the group in the order of $2 million. http://www.sharescene.com/html/emoticons/smile.gif

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Drill and blast specialist, Brandrill Limited, announced today their $8.0 million net profit result for 2005-06 and released their audited annual accounts.

 

The $8.0 million net profit result is after a positive tax adjustment of $1.9 million. Pre-tax profit for FY2006 is $6.2 million, some 280% above the comparable FY2005 trading result of $1.6 million.

 

Sales revenues for FY2006 were $103 million, an increase of 43% over last year’s $71 million. Revenue growth has been through increasing the number of rigs employed, expanding the contractual base of the company and increasing numbers of staff.

 

Profit margins and revenues grew significantly from the first to the second half of the year driven by a number of factors:

? Ongoing incremental improvements in operational productivity, efficiency and improved

purchasing terms following the completion of our restructuring;

? Increases in rig reliability and mechanical availability stemming from upgraded

maintenance performance;

? The commencement of the major overhaul and maintenance workshop at Henderson

allowing rigs to be returned more quickly and cost effectively to work;

? Some increases in rates reflecting a tightening of demand for our services; and

? The benefit through economies of scale from growth in revenues against our largely fixed

overhead structure.

 

The balance sheet has positioned the company for further growth. As at 30 June 2006, the net debt to equity ratio was 32%, working capital stands at $10 million and the interest cover ratio is five times.

 

Managing Director, Ken Perry, commented “This is a very pleasing result. With $100 million work already locked in for this year, and four big rigs to be delivered in the next six months, the foundation has been laid for further strong growth in 2007 in both revenue and profit.

 

The industry outlook for both iron ore and coal is very healthy for the foreseeable future”.

 

The strategy remains to focus on growing the drill and blast business in Australia. The major objectives are to obtain more trained staff, acquire additional cost effective drill rigs and secure long production related contracts with reputable clients.

 

For further information: Mr Philip Werrett, Company Secretaryi

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Full blast: Orica considers expansion

Andrew Trounson

November 13, 2006

EXPLOSIVES giant Orica is considering expanding into the open-cut mine blast drilling business as it pursues a full-service model in the provision of explosives to the mining industry.

Rival Dyno Nobel has already bought drilling assets in the US and Canada. The latest was the acquisition of Florida-based Angelini Blasting in September.

 

Orica has been sceptical about the merits of moving into blast drilling, which, unlike deep exploration drilling, is a less sophisticated business and so has only low margins.

 

But as the business of blowing up dirt and rock becomes itself increasingly sophisticated, the need for precision blast drilling could make it more attractive.

 

Orica reluctantly found itself having to become a blast driller by default after a provider went out of business at the Stockton coal mine in New Zealand where Orica was providing the explosives. But the move to bring blast drilling in-house proved such a success that Orica is now looking at whether it is worth expanding elsewhere.

 

"We are still determining whether we want to be in drilling or not. We have made a success of it in NZ - maybe we can make a success of it elsewhere," said Orica global technology manager for mining applications Stephen Boyce. "The jury is still out."

 

Orica and Dyno Nobel are seeking to become fuller service providers and are offering mining companies more sophisticated blasting technologies, including electronic detonations that allow computer-monitored sequencing of thousands of individually micro-timed detonations in just one blast. This allows miners to blast away dirt and rock while minimising damage to mineral seams. Waste rock can also be blasted away into specific areas where it does not have to be moved again.

 

In Australia, the two main blast drilling providers are Western Australia-based Ausdrill and Brandrill, both of which blast drill as part of their wider drilling businesses.

 

While exploration drilling involves having to drill down hundreds of kilometres while monitoring the various rock types, blast drillers only go down a few metres, drilling holes that can be filled with ammonium nitrate explosive. While the margins are lower, it is a steady business, commonly done on long-term contracts.

 

Although Dyno has moved into drilling in North America, no such moves have been made in Australia, and Ausdrill chief executive Ronald Sayers is sceptical about the benefits for Orica or Dyno of moving into blast drilling.

 

"We should stick to our knitting and they should stick to theirs," he said, noting that the likes of Ausdrill had the necessary expertise to provide contract drilling services.

 

 

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President Steyn lifts gold production by 6%

July 12, 2001

 

By Sapa

 

Johannesburg - Junior gold miner President Steyn yesterday reported a 6 percent increase in gold production to 45 871 ounces for the June quarter.

 

The company said the Loraine 3 shaft increased its contribution and further increases were expected.

 

Cash costs for the quarter were $223 an ounce, which meant it had achieved R58,118 for each kilogramme. That was marginally higher than expected, but the figure included costs relating to a 16 000-ton stock build-up. Cash operating profit rose 6,9 percent to R15,9 million for the three months.

 

Recovered grade increased from 4,3g a ton to 4,7g a ton.

 

Strong operating cash flow of R27,1 million for the six months to June was achieved, resulting in a net increase in cash resources of R7,7 million after the repayment of R10,2 million on long-term loans.

 

Capital expenditure of R16 million was expedited during the first six months, the mine said.

 

Management planned to build up ore stocks to counter a possible strike, which was subsequently averted.

 

The stockpile was 16 000 tons at the end of June, and production costs relating to the additional production had been accommodated in the quarterly figures.

 

Projects such as the Pot of Gold and Golden Triangle were starting to contribute to the financial results of the mine, the company said.

 

Looking ahead, President Steyn said Brandrill had conducted 200 cartridge tests at President Steyn 1a shaft, establishing the integrity of the controlled rock-breaking blasts.

 

The tests were successfully concluded on the A reef and Basal reef, and the mine described the procedure as "a real breakthrough".

 

President Steyn and Brandrill had signed a co-operation agreement for the development and implementation of a continuous mining system. The development phase of the system would be completed during the next four to six months, it said.

 

President Steyn also entered into a preferential licensing agreement with Brandrill that would regulate the execution of the jointly developed intellectual property and commercial implementation of the technology.

 

A system had been developed to haul gold-bearing mud from underground, which would add to the recovered gold once in full operation.

 

The ore reserves had been increased from 0,87 million ounces to 2,59 million ounces since October 2000.

 

 

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Drilling giant Boart seeks $2.6b float with view to acquisitions

2nd March 2007, 7:30 WST

 

 

Global drilling giant Boart Longyear has unveiled a $2.6 billion Australian sharemarket float ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€¦Ã‚¡ÃƒÆ’‚¬Ãƒâہ¡ÃƒÆ’‚ the biggest in more than two years ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€¦Ã‚¡ÃƒÆ’‚¬Ãƒâہ¡ÃƒÆ’‚ underpinned by a sixmonth spending spree that has seen it snap up some of WAÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s best known drilling contractors.

 

Already controlling names such as North West Drilling, DrillCorp, Grimwood Davies and KWL, Boart said yesterday corporate acquisitions would continue to be a key plank of its growth strategy, adding it already had a hit list of more than 100 potential targets.

 

Chief executive Paul Brunner would not be drawn on specific targets, but speculation has already started that Boart could have its sights set on other WA drilling contractors such as Ausdrill, Brandrill and Swick Mining Services in a bid to further boost its exposure to the booming WA resources market.

 

ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“We have an awful lot of growth opportunities, IÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢m not going to go into great detail (but) acquisitions are the key part of what we do,ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ he said. ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“The company is pretty reserved about talking about its acquisitions simply because we are in a competitive market. We have people who are looking at the same opportunities weÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢re looking at.ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ÂÂ

 

Mr Brunner said among the list of more than 100 opportunities there were between 10 and 15 at any given time ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“that we are seriously thinking aboutÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ÂÂ.

 

ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“We would have one or two that we would be talking to at any given time to try and see if we can find any way we can do a deal,ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ he said.

 

Boart, once part of the mighty Anglo American mining group before a private equity-backed management buyout in mid-2005, said it planned to raise between $2.26 billion and $2.65 billion at an indicative price range of $1.76 to $2.10, giving it a market capitalisation of between $2.61 billion and $3.12 billion on listing.

 

But none of the money raised in the float will be retained by the company, with $1.3 billion paid to existing owners, including a complete buyout of Advent International and Bain Capital, and the remainder spent paying down debt.

 

With a corporate office in Sydney and an operations office in Salt Lake City, Utah, Boart operates more than 1000 rigs in 30 countries and has more than 7800 employees.

 

The company has forecast revenue of $US1.5 billion ($1.9 billion) and earnings before interest and tax of $US320 million and a net profit of $US193.2 million for 2007. That puts the company on a price to earnings ratio of between 13.3 and 15.8 times, depending on the final share price.

 

MICHAEL WEIR

 

interesting times http://www.sharescene.com/html/emoticons/wink.gif

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Dyno Nobel prizes Canadian drill firm

Andrew Trounson

March 29, 2007

 

EXPLOSIVES giant Dyno Nobel extended its expansion into drilling services yesterday by acquiring Canada's largest drill-and-blaster, Castonguay, for $53 million including debt.

The move will stoke speculation that Dyno, or larger rival Orica, could eventually expand into drilling in Australia as part of their strategies to provide a full-service offering.

Castonguay is the third North American drill-and-blasting company acquired by Dyno.

 

But it is understood that at this stage Dyno isn't planning a move into drilling in Australia.

 

Orica chief Graeme Liebelt has said drilling services aren't a focus for the company, but the company may be interested in drilling to the extent that there may be opportunities to bundle drilling services with its explosives offering.

 

In Australia, the main blast drillers are Ausdrill and Brandrill, which both offer broader drilling services.

 

Blast drilling is different from exploration drilling in that the holes are usually only a few metres deep and as a result is a generally lower-margin business.

 

The family-owned Castonguay would provide additional "pull-through" demand for its explosives products and services, Dyno said.

 

Castonguay operates mainly in the quarrying business.

 

Dyno chief executive Peter Richards said the acquisition "provides a platform for expanded services to existing and future customers in the region".

 

 

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